Price gouging has become a serious concern amidst the coronavirus panic over the last week, as the disease is expected to infect many more people and possibly take several more American lives.
The largest online retailer, Amazon, has already said that thousands of items have been removed due to high priced offers. Many seller accounts associated with these practices were temporarily suspended.
The company released a statement after Senator Markey of Massachusetts had formally asked Amazon about how they would handle illegal practices during the virus outbreak. The Senator also asked Jeff Bezos personally about how his company is establishing criteria to find illegal pricing activity.
Amazon’s vice president of public policy handled most of the talking related to the company’s anti price gouging measures. He said that the company constantly monitors their online marketplace for unfair sales and aggressively enforces policies against these practices if they feel a seller has violated their terms. Their fair pricing policy is put into place precisely for the purpose of protecting customers.
They mentioned that approximately 530,000 listings have already been removed. Amazon also suspended about 2,000 seller accounts that were suspected of price gouging. They are working with various local prosecutors in each state to formally file charges against anyone that is engaged in criminal activity.
eBay has taken similar measures to combat price gouging online due to concerns about the potential for a large number of cases on U.S. soil. Some items such as face masks, hand sanitizer, and disinfecting wipes have been totally banned from the marketplace for the near future. However, enforcement of this temporary ban is still a problem, as it seems that several new listings are still emerging every day. Some of these listings have packages of face masks and bottles of hand sanitizer in the $100 to $300 range. Packages of the same face masks had previously sold for about $13 on Amazon weeks earlier.
A spokesperson from the company said that eBay has billions of listings which are not always easy to manage, but concerned buyers are able to report any listing directly from the item’s page. They are also proactively working to implement and enforce new policies since the virus has created opportunities for price gougers.
Walmart has dealt with similar issues in their online listings, and they were one of the companies that has been formally asked by various media outlets and government agencies to do everything they can to stop illegal activity or prosecute offenders.
Politicians in both California and Washington have already been taking measures to control prices in brick and mortar retailers, as these two states are expected to be hit the hardest by the virus. California declared a state of emergency and mandated that any price increases of more than ten percent are now illegal.
The regularity of price gouging during emergencies
Price gouging is defined as the act of illegally reselling or highly inflating the price of certain in demand items due to increased sales during an emergency. Some states routinely have people prosecuted for this illegal act when a natural disaster occurs. Price gouging can be extremely serious when essential supplies like food, water, medicine, and gasoline are resold at absurd prices.